Japanese tyre maker Bridgestone Corporation on sunday said it is investing Rs. 170 crore at its factory in Indore to manufacture truck and bus radial tyres by May next year.
The company said it is witnessing increased demand for truck and bus radial tyres (TBRs) in India which has prompted it to start local manufacturing, instead of importing in small quantities from Japan.
“Currently, we are importing TBRs from Japan and enjoy about five per cent share. The plan is to start manufacturing TBRs at the Indore facility by May next year,” Bridgestone India Managing Director Hiromi Tanigawa told PTI.
He said the investment of Rs. 170 crore is being made for setting up a new line at the existing facility that currently manufactures passenger car tyres.
The Indore facility produces about 15,000 passenger car tyres per day and the new line for TBRs will have a capacity to make 400 tyres per day when it becomes fully operational by 2012.
The additional investment is over and above the Rs. 2,600 crore, that the company has earmarked to set up a second production facility in India near Pune to make passenger car, truck and bus tyres.
“The new facility at Chakan near Pune is likely to be operational by 2013,” Bridgestone India Director, Sales and Marketing, H. Gonzalez Mori said.
The Pune facility will have a total capacity to make 10,000 passenger car tyres and 3,000 TBRs per day by 2020.
With local manufacturing of TBRs, the company is aiming for a market share of 15 per cent by 2015 in that segment, up from 5 per cent at present. As per the Automotive Tyre Manufacturers’ Association (ATMA) of India, the total truck and bus tyre segment stood at 72.79 lakh units in 2000-10.
“Once local manufacturing begins, we will start talks with original equipment makers (OEMs) for supplying TBRs,” Tanigawa said.
Talking about the company’s business plan in India Tanigawa said, “We want to be a market leader here in every segment, be it passenger car, TBRs or Off the Road (OTR) tyres.”
Bridgestone may also consider local manufacturing of OTRs as well in India at a later stage, he said, adding at present they are being imported from Japan.
Moreover, the company is also looking to expand its dealership network in India.
“We work with around 1,900 dealers in India for passenger car tyres, which is likely to go up to 3,000 by 2014-15. For TBRs, we currently have 190 dealers, and are planning to the number to 250 by next year,” Mori said.
Commenting on the increasing rubber prices and rising input costs, Tanigawa said the company has recently taken a price hike of about two per cent on its products.
“Input costs are increasing and after a point we are forced to take price hikes. In December, the company has taken an increase of about two per cent. Going ahead, we will see how the input costs are and take a decision accordingly,” Tanigawa added.